Bitcoin Plunges Below $65K, Sparks Massive Liquidations

• Bitcoin fell to $64.2K in two hours, causing massive long liquidations and a surge in negative market sentiment.

• $990M in Bitcoin open interest vanished as overleveraged traders rushed to close positions.

• Other cryptos also faced pressure: Ether $113.9M, Solana $19.9M, and HYPE $10.7M in forced liquidations.

Bitcoin just tumbled below the $65,000 mark, igniting fear across cryptocurrency markets. According to analytics platform Santiment, the drop came within just two hours, driving Bitcoin to $64,200, its lowest level since February 5th.

Many long positions liquidated rapidly, pushing total open interest down to $19.5 billion — less than half of January 14th’s peak of $38.3 billion. Hence, traders and retail investors reacted strongly, sending negative sentiment to a two-week high despite the Sunday night timing in the U.S., which usually sees low social volume. The market’s mood turned sharply pessimistic as $65K support broke, and retail investors rushed into FUD mode, a dynamic that historically can trigger swift rebounds.

Moreover, the data highlighted a significant wipeout in leveraged positions. Nearly $990 million in open interest disappeared as traders closed positions to limit losses. The rapid contraction in leverage pointed to a classic flush-out event, forcing overexposed participants out of the market. Santiment’s chart illustrated a moment of intense volatility, showing both the impact of fear and the speed at which speculative positions unwind.

Massive Liquidations Hit Crypto Traders

The consequences extended beyond Bitcoin alone. Cryptocurrency exchange HTX executed a $61.5 million liquidation, marking the largest forced closure in the past 24 hours, according to Coinglass. The liquidation occurred as Bitcoin slid from $68,600 over the weekend to $64,400 in hours, erasing gains quickly.

Furthermore, total liquidations across 137,422 traders reached $467.64 million. Long positions represented $434 million, about 93% of the total, reflecting a market heavily positioned for upside that suddenly faced disappearing bids.

Additionally, other assets faced pressure. Bitcoin futures accounted for $213.62 million in forced closures, Ether saw $113.89 million, Solana $19.89 million, and Hyperliquid’s HYPE token added $10.72 million.

The data from Glassnode confirmed this observation, saying that short-term holders continue to capitulate. The seven-day moving average of net realized losses continues to be close to $500 million per day.